Sure, people trust Google to come out with cool technology. But do they trust Google with their data and their privacy? Many don’t. Worse, many fear what Google does or could do with the data it aggregates.

I’ll let Google itself tell the story. If you do a Google search on “Google” and “big brother” you’ll get a whopping 58.9 million hits. Doing the same for “Microsoft” and “big brother” yields only 7.1 million. Even more surprising, a search on “government” and “big brother” results in just 13.4 million hits. Using search results as a rough proxy: people are more than 4 times more concerned that Google, rather than the government, is amassing too much information about us.

I see a lot of parallels between Google today and Microsoft circa 1999. What security was to Microsoft (but to Microsoft’s credit, isn’t any longer), privacy is to Google: a looming threat of customer dissatisfaction that could result in a mass migration of users and their eyeballs away from Google’s applications and search engine. And the friction for such a diaspora from Google’s web-based services and add-on applications is far lower than from Microsoft’s Windows or Office.

Google’s reputation is suffering, and it’s brand value is eroding. In 2008, Google dropped off the top 20 list of the Ponemon Institute-TRUSTe survey of most trusted companies, after coming in at #11 in 2007. It remains off the top 20 list for 2009.

Hopefully, this is something Google will recognize as an issue and start to address before it gets worse.